I've had this sort of thing happen a few times. It is strictly a bad situation. I have to say C, if you think you can get out of there safely. Safety is the primary concern here. You could be shot. If a gobbler shows up, you don't know if your shot is going to hit the other guy. This is where having a little hunter orange to put on helps. When I hunt public land I carry at least an orange hat when I'm up walking.
#2 son and I got a shot string over our heads once on my own property from a poaching neighbor on our first time out on our new farm. In another situation, a buddy of mine and I were on our side of the line calling to a turkey on the same side . The line ran down a creek bed. There was another hunter somewhere on the other side that we could not hear. The gob came up and crossed the line and went to the other hunter, but in doing so, he came between us all. All we knew was it seemed like the gobbler was doing and end-around us and BLAM!
Be conservative. Announce yourself and explain your intentions before you start making movement. I've had to announce myself with squirrel hunters and rabbit hunters during deer season. There's nothing quite as chilling as being all dolled-up in camo up in a tree and see a squirrel hunter come in and start looking your way. Sensible people appreciate being told they are encroaching.